Can An Unemployed Person
Get A Home Loan?

Being unemployed makes getting a home loan harder because lenders need to see a reliable source of income for repayments. Without employment, approval usually depends on whether the lender accepts another income source or whether another borrower on the application earns enough to service the loan.

The issue is less about having a job title and more about whether the lender accepts the income available to your household.

So, How Do I Get A Home Loan If I’m Out Of A Job?

Most lenders will want evidence of ongoing income before approving a home loan. If you’re unemployed, the application usually needs another acceptable source of income.

Possible options include:

Using A Co-Borrower Or Co-Signer

Another person, such as your spouse or parent, may support the application if they have enough income and meet the lender’s requirements.

The distinction between a co-borrower and co-signer matters. Their responsibilities, ownership position and liability for the debt are not necessarily the same.

Using Investment Income

Some lenders assess regular investment income, including dividends and other returns, when calculating borrowing capacity.

The lender will usually look at how consistent the income has been and whether it is expected to continue. Owning investments alone does not establish that you have enough income to repay a mortgage.

Using Other Sources Of Income

Employment income is not the only income lenders assess.

Depending on the lender and your circumstances, assessable income may include rental income, dividends, trust distributions and other recurring income.

What matters is whether the lender recognises the income and how much of it they use in their servicing assessment. A lender may accept an income source but assess only part of it.

Using Your Assets And Net Worth

A strong asset position can support an application, but substantial assets do not automatically replace the need to show that repayments are affordable.

This distinction matters for unemployed borrowers. Having significant savings or equity reduces financial risk, but lenders still assess how the mortgage will be serviced over its term.

What if I just started a new job?

If you recently lost your job, tell your broker before proceeding with the application.

Your previous employment history, savings and other income may help explain your financial position, but lenders generally assess the income available now rather than income you expect to earn in a future job.

A new employment contract may change the position. Some lenders assess borrowers who have recently started a new role, particularly where their employment history supports the move.

The practical mistake to avoid is assuming that a long employment history will compensate for having no current assessable income. The lender still needs to establish how the proposed repayments will be met.

I Lost My Job Before Settlement. What Can I Do?

Tell your broker as soon as your employment circumstances change.

Losing your job after approval but before settlement creates a different problem from applying while unemployed. The lender approved the loan based on information supplied during the application, and a material change before settlement may affect that approval.

Savings available to cover repayments and prospects of returning to work are useful contexts, but they do not remove the need to disclose the change. Your broker should review the lender’s requirements before you proceed. This is especially important before making further financial commitments connected with the purchase.

What If I Just Started A New Job?

Starting a new job does not automatically prevent you from getting a home loan.

Some lenders assess borrowers who have recently changed jobs, including applicants still within a probationary period. Your previous employment history, industry, role, income structure and employment contract often affect the lender’s decision.

A move between similar roles can be easier for a lender to assess because it shows continuity in your employment history.

Home Loan Experts work with borrowers whose employment does not fit the standard long-service profile, but the lender choice needs to match the details of the new role.

Can I Get A Home Loan While On Probation At Work?

Being on probation does not automatically stop a home-loan application.

Some lenders accept borrowers during probation, particularly where the applicant has a strong employment history in the same occupation or industry.

The original page states that some lenders look for:

• A probation period of three to six months.
• At least two years in the same industry or role.

Those figures should not be treated as universal lending rules. Lender policy differs, and the strength of the application depends on factors such as your employment history, income, deposit and overall financial position.

If you recently started your job, lenders may request documents such as your employment contract and payslips.

Read more about applying for a home loan during your probationary period.

You can also use our new-job home-loan calculator to get an initial indication of how lenders may assess your situation.

What If I’m Working Only Temporarily?

Temporary employment requires closer lender selection because lenders differ in how they assess short employment contracts and limited tenure.

Your work history becomes particularly important. A borrower who has moved consistently between contracts in the same field presents a different employment profile from someone entering temporary work for the first time.

The original page states that:

• Most lenders require a 12-month employment history.
• At least one lender accepts a three-month employment history.
• Applicants generally need a strong financial position and established work history.

These policy claims should be checked against current lender criteria before publication.

Read more about home loans for temporary workers.

What If I’m A Casual Employee?

Casual employment does not automatically prevent you from qualifying for a home loan.

Lenders usually focus on how long you have worked casually, the consistency of your income and your employment history.

The original page states that most lenders want 12 months in the job, while some lenders accept three to six months, particularly in industries such as health, IT and education.

This is the type of policy difference that makes lender selection important. A casual employee rejected under one lender’s minimum employment requirement may fit another lender’s criteria.

Read more about home loans for casual employees.

Can I Get A Home Equity Loan Without A Job?

p>Having equity does not automatically mean a lender will approve further borrowing.

For a home equity loan or equity release, the lender still assesses your ability to repay the additional debt. If you are unemployed, another acceptable income source usually needs to support the application.

The original page identifies rental income, trust income, child support and other sources as possible alternatives to employment income. Their treatment differs between lenders, so each source should be confirmed before relying on it for servicing.

A co-borrower’s income may also affect the application where that person is legally responsible for the loan.

A Case Study

We had a customer who was unemployed, while her husband earns about $120,000 a year.

They planned to move back to their home state and buy a property after selling their existing home. They had about $40,000 available for the deposit and intend to spend less than $300,000.

Our customer expected to earn about $45,000 to $55,000 a year once she returned to work.

The lender would not normally assess the application based on the customer’s expected future salary unless that income met its lending requirements.

Instead, their application primarily depended on the income the lender accepted at the time of assessment, including her husband’s income, together with their debts, expenses, deposit and other servicing factors.

How To Get Approved After Unemployment

Once you return to work, your lender options may improve. The strength of the application depends on the new employment arrangement and the rest of your financial position. Focus on the factors lenders are likely to examine:

Employment continuity: Returning to the same industry or a similar occupation gives the lender more evidence of an established work history.

Proof of employment: Keep your employment contract and recent payslips ready.

Deposit size: A larger deposit reduces the loan-to-value ratio. A deposit of 20% may also avoid Lenders Mortgage Insurance in many standard lending situations.

Reason for the employment change: Be ready to explain any recent gap or change where the lender requests this information.

Cash reserves: Savings left after settlement give you a stronger financial buffer than using every available dollar for the purchase.

Credit conduct: Missed repayments, late payments and other recent credit issues may make an application harder, particularly when combined with a recent employment change.

Lender selection: Employment policies differ. A borrower who falls outside one lender’s minimum time-in-job requirement may still fit another lender’s policy.

Home Loan Experts can assess your employment history, current income and financial position before recommending a lender. This reduces the risk of applying with a lender whose employment policy does not suit your situation.

Call 1300 889 743 or complete our free assessment form to discuss your options.